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Budget for the year 2020: The budget for the year 2020 was prepared in December 2019 and had the following components: Revenue: The revenue is calculated as number of hours that the crew works on a site, multiplied by the contracted rate with the client. The hours worked in the residential and commercial segments are shown separately, and there is a total for the combined hours worked. The revenue for each segment is arrived at by multiplying the hours for the segment by the rate. The budget is prepared for four quarters, one to four. For 2020, the budgeted sales hours were: Quarter 1 2 3 4 Budgeted commercial sales in 2,500 2,600 2,200 2,000 hours Budgeted residential sales in hours 2,600 2,200 2,000 2,600 For 2020, the budgeted sales hours were: Quarter 1 2 3 4. $46 $46 $46 Selling price per hour (commercial) Selling price per hour (residential) $46 $52 $52 $52 $52 Direct Labour expense: SCS will pay its employees an hourly rate of $ 23 for the entire year. Cleaning supply usage: The budgeted usage is 0.28 litre / labour hour for the commercial segment and 0.2 litre/ labour hour for the residential segment. This is constant for the entire year. 15 ID MGMT 8500 BUDGET ASSIGNMENT - F21 Cleaning supply expense: Budgeted expense is $ 6.00 per litre for the entire year. Fixed overhead: To support the cleaning operations, there are four items of expenditure. These are designated as overheads and their budgeted expenses are as follows: Receptionist: Budgeted expense is $ 6 000 per quarter and is the same for all four quarters. Depreciation: This relates to the depreciation of vehicles used to transport employees to client locations. Budgeted expense is $ 8 000 per quarter and is the same for all four quarters. Gas: Budgeted expenditure on gas is $ 7,500 and is the same for all four quarters. Maintenance: Budgeted expenditure on Office Supplies is $ 1 200 per quarter and is the same for all four quarters. Actual results for the year 2020. It is now January 7, 2021 and Sparkling Clean Services (SCS) is comparing the actual expenses against their budget. Here is what they found. Revenue: For 2020, the actual sales hours were: Quarter 1 2 3 4 Actual sales - commercial 2,400 2,600 2,300 2,100 Actual sales - residential 2,500 2,300 1,800 2,400 For 2020, the actual hourly revenue was: Quarter 1 2 3 4 4 Actual selling price - $45 $45 $45 $45 16 | Page MGMT 8500 BUDGET ASSIGNMENT - F21 commercial Actual selling price - $53 $53 $53 $53 residential Direct Labour expense: SCS paid its employees an hourly rate of $ 24 for the entire year. Cleaning supply usage: The actual usage was 0.35 litre / labour hour for commercial segment and 0. hour for the residential segment. This was constant for the entire year. itre/ labour Cleaning supply expense: Actual expense was $6.30 per liter for the entire year. Fixed overhead: To support the cleaning operations, there are four items of expenditure. These are designated as overheads and their budgeted expenses are as follows: Receptionist: Actual expense was $ 6 200 per quarter and is the same for all four quarters. Depreciation: This relates to the depreciation of vehicles used to transport employees to client locations. Actual expense was $ 8 200 per quarter and was the same for all four quarters. Gas: Actual expenditure on gas was $ 7100 and was the same for all four quarters. Maintenance Actual expenditure on Office Supplies was $ 1 000 per quarter and was the same for all four quarters. Unproductive (unbilled) factor: Cleaning crews had to work 4% over the revenue generating hours to attend to complaints and do a second cleaning. These hours were not billable to clients, but SCS would pay the 7 Page Required: Part A: For this part you will use the template provided in Excel Workbook format. Complete the following steps in sequence: Step # Spreadsheet title One Input Database Two Input Database Three Static Budget Four Actual Budget Activity Populate the section A4:G24 with data from the above case and develop the budget parameters. Populate the section K4:Q35 with data from the above case and develop the actual parameters. Populate the section AZ:F29 with data from the spreadsheet 'Input Database' and develop the static budget. Populate the section AZ:F29 with data from the spreadsheet 'Input Database' and develop the actual budget. Populate the section A7:F29 with data from the spreadsheet 'Input Database' and develop the flexible budget. Populate the section A5:E26 with data from the spreadsheets 'Static Budget' and 'Actual Budget' and develop the static budget variance. Populate the section G5:J26 with data from the spreadsheet 'Actual Budget' and 'Flexible Budget' and develop the flexible budget variance. Using applicable data complete the analysis of Five Flexible Budget Six Var Analysis - Static and Flex Seven Var Analysis - Static and Flex Eight Material variances Material variances for both the commercial and residential segments. 8 Page MGMT 8500: BUDGET ASSIGNMENT F21 Nine Labour variances Using applicable data complete the analysis of Material variances for both the commercial and residential segments. Other guidelines: Data should be entered in the 'Input Database' spreadsheet only. . For all other spreadsheets, you must use cell references, linking data from 'Input Database' or other spreadsheets. Do not enter data or calculations without cell references. . To calculate variances, you need to use 'IF' formula. Part B: In week 8, your Professor will be discussing about ethical practices during budget preparation. One such practice involves use of 'budgetary'slack'. Reflecting on this learning experience, you will write a memo to the CEO of SCS. . The CEO is concerned regarding ethical practices and needs your advice. In your role as a consultant, write a memo explaining what unethical practices can be incorporated during budget preparation Structure of the memo: Word limit: 300 words maximum . Arial or Calibri font Memo format As MS Word document (any other format will receive a zero mark) Memo will be verified through Turnitin. Deliverables: Completed Excel workbook. 9|Page Budget for the year 2020: The budget for the year 2020 was prepared in December 2019 and had the following components: Revenue: The revenue is calculated as number of hours that the crew works on a site, multiplied by the contracted rate with the client. The hours worked in the residential and commercial segments are shown separately, and there is a total for the combined hours worked. The revenue for each segment is arrived at by multiplying the hours for the segment by the rate. The budget is prepared for four quarters, one to four. For 2020, the budgeted sales hours were: Quarter 1 2 3 4 Budgeted commercial sales in 2,500 2,600 2,200 2,000 hours Budgeted residential sales in hours 2,600 2,200 2,000 2,600 For 2020, the budgeted sales hours were: Quarter 1 2 3 4. $46 $46 $46 Selling price per hour (commercial) Selling price per hour (residential) $46 $52 $52 $52 $52 Direct Labour expense: SCS will pay its employees an hourly rate of $ 23 for the entire year. Cleaning supply usage: The budgeted usage is 0.28 litre / labour hour for the commercial segment and 0.2 litre/ labour hour for the residential segment. This is constant for the entire year. 15 ID MGMT 8500 BUDGET ASSIGNMENT - F21 Cleaning supply expense: Budgeted expense is $ 6.00 per litre for the entire year. Fixed overhead: To support the cleaning operations, there are four items of expenditure. These are designated as overheads and their budgeted expenses are as follows: Receptionist: Budgeted expense is $ 6 000 per quarter and is the same for all four quarters. Depreciation: This relates to the depreciation of vehicles used to transport employees to client locations. Budgeted expense is $ 8 000 per quarter and is the same for all four quarters. Gas: Budgeted expenditure on gas is $ 7,500 and is the same for all four quarters. Maintenance: Budgeted expenditure on Office Supplies is $ 1 200 per quarter and is the same for all four quarters. Actual results for the year 2020. It is now January 7, 2021 and Sparkling Clean Services (SCS) is comparing the actual expenses against their budget. Here is what they found. Revenue: For 2020, the actual sales hours were: Quarter 1 2 3 4 Actual sales - commercial 2,400 2,600 2,300 2,100 Actual sales - residential 2,500 2,300 1,800 2,400 For 2020, the actual hourly revenue was: Quarter 1 2 3 4 4 Actual selling price - $45 $45 $45 $45 16 | Page MGMT 8500 BUDGET ASSIGNMENT - F21 commercial Actual selling price - $53 $53 $53 $53 residential Direct Labour expense: SCS paid its employees an hourly rate of $ 24 for the entire year. Cleaning supply usage: The actual usage was 0.35 litre / labour hour for commercial segment and 0. hour for the residential segment. This was constant for the entire year. itre/ labour Cleaning supply expense: Actual expense was $6.30 per liter for the entire year. Fixed overhead: To support the cleaning operations, there are four items of expenditure. These are designated as overheads and their budgeted expenses are as follows: Receptionist: Actual expense was $ 6 200 per quarter and is the same for all four quarters. Depreciation: This relates to the depreciation of vehicles used to transport employees to client locations. Actual expense was $ 8 200 per quarter and was the same for all four quarters. Gas: Actual expenditure on gas was $ 7100 and was the same for all four quarters. Maintenance Actual expenditure on Office Supplies was $ 1 000 per quarter and was the same for all four quarters. Unproductive (unbilled) factor: Cleaning crews had to work 4% over the revenue generating hours to attend to complaints and do a second cleaning. These hours were not billable to clients, but SCS would pay the 7 Page Required: Part A: For this part you will use the template provided in Excel Workbook format. Complete the following steps in sequence: Step # Spreadsheet title One Input Database Two Input Database Three Static Budget Four Actual Budget Activity Populate the section A4:G24 with data from the above case and develop the budget parameters. Populate the section K4:Q35 with data from the above case and develop the actual parameters. Populate the section AZ:F29 with data from the spreadsheet 'Input Database' and develop the static budget. Populate the section AZ:F29 with data from the spreadsheet 'Input Database' and develop the actual budget. Populate the section A7:F29 with data from the spreadsheet 'Input Database' and develop the flexible budget. Populate the section A5:E26 with data from the spreadsheets 'Static Budget' and 'Actual Budget' and develop the static budget variance. Populate the section G5:J26 with data from the spreadsheet 'Actual Budget' and 'Flexible Budget' and develop the flexible budget variance. Using applicable data complete the analysis of Five Flexible Budget Six Var Analysis - Static and Flex Seven Var Analysis - Static and Flex Eight Material variances Material variances for both the commercial and residential segments. 8 Page MGMT 8500: BUDGET ASSIGNMENT F21 Nine Labour variances Using applicable data complete the analysis of Material variances for both the commercial and residential segments. Other guidelines: Data should be entered in the 'Input Database' spreadsheet only. . For all other spreadsheets, you must use cell references, linking data from 'Input Database' or other spreadsheets. Do not enter data or calculations without cell references. . To calculate variances, you need to use 'IF' formula. Part B: In week 8, your Professor will be discussing about ethical practices during budget preparation. One such practice involves use of 'budgetary'slack'. Reflecting on this learning experience, you will write a memo to the CEO of SCS. . The CEO is concerned regarding ethical practices and needs your advice. In your role as a consultant, write a memo explaining what unethical practices can be incorporated during budget preparation Structure of the memo: Word limit: 300 words maximum . Arial or Calibri font Memo format As MS Word document (any other format will receive a zero mark) Memo will be verified through Turnitin. Deliverables: Completed Excel workbook. 9|Page